Property Know

In recent news it has been pointed out that the targets set for housing will not be met. The government has set a target of 3 million new homes to be built by the year 2020. It will approximately need 240,000 homes built a year to meet the target that was set, last year just over 200,000 new homes were built. Unless changes are made now it will be more then likely that the target set will not be met.

Home builders have recently decided to cut back on the new builds due to the reduced demand from the falling market. Mr Nickell, who heads the national housing and planning advice unit said “Unless local authorities are given a strong incentive to allow house building in their locality, it seems to me very unlikely that we will hit the housing targets………And if you don’t keep building these houses the prices just keep going up relative to people’s incomes” Mr. Nickell believes apart from the credit crunch affecting consumers, local authorities and councils are not offering enough incentives to encourage the building of new homes.

Recent government figures have showed that new building of new homes have been down 5% compared to the same time in 2007. A statement from the Home Builders Federation has predicted that the building of new homes is not expected to rise.
“Right now the credit crunch is stopping people from getting the finance that people need to buy homes……… Longer term we need a better business environment and less regulatory cost to get the industry moving” This statement from the federation is backed up by recent news of big players in the industry, Barratt Developments and Taylor Wimpey to be in huge amount of debt. These two major players carry between them a total of £2.5 billion debt which is significantly more then their total market value. The credit crunch not only has affected consumers but the industry itself, the pinch felt by members of the industry has already forced one of them to put a halt on the building of new homes.